The government of Tanzania has given the Tanzania Agricultural Development Bank (TADB) US $25 million to guarantee loans applied for by small farmers and Small and Medium Enterprises (SMEs).
TADB Managing Director, Japheth Justine conformed the report and said the bank received the funds from the Prime Minister’s Office to enable the bank guarantee loans to farmers and their institutions and alleviate the problem of farmers accessing credit.
In Tanzania, banks and financial institutions demand collateral worth between 125% and 150% of the total loan amount applied for. Mr Justine assured vine farmers of financial support from TADB, explaining that vine is one of Tanzania’s strategic cash crops.
Concessionary terms
“The government knows that small and middle farmers are unable to meet 50% of collateral or loan conditions. To overcome this problem, the government has given our bank US %, so that our bank can guarantee loans applied for by farmers in our partner commercial banks. I take this occasion to assure vine growers of getting loans from our bank on concessionary terms,” said Mr. Justine.
Mr Justine was speaking to reporters after attending a meeting called and chaired by Prime Minister Kassim Majaliwa that discussed ways of increasing grape production and processing. Until last month, TADB has supported vine value chains by disbursing 463,983,800/-, it disbursed 70,000,000/- to build warehouses, 27,025,000/- to secure machines and 366,958,800/- to build infrastructure in vine farming areas.
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